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Are Laneway and Garden Suites the Ultimate Home Upgrade?

As we all know, finding the perfect place to call home in this bustling metropolis can be a bit like playing a game of real estate musical chairs, with prices soaring and space shrinking faster than you can say “condo with a view.”

Toronto is actively expanding its housing options, particularly focusing on the ‘missing middle’ housing forms like duplexes and low-rise walk-up apartments. While these housing types exist in various parts of Toronto, they have historically faced limitations in new construction areas. The city’s initiative, Expanding Housing Options in Neighbourhoods, is a forward-thinking approach to enriching our residential areas with more low-rise housing options, meeting the needs of our growing city. This initiative is a beacon among the city’s efforts to enhance housing choice, accessibility, and pave the way for a more equitable, sustainable city.

As housing prices rise and space becomes a premium, Toronto homeowners are turning to laneway houses and garden suites for some much-needed breathing room. These clever little units not only expand living spaces but also open up exciting possibilities like rental income or a private oasis for family members. As the city continues to grow, laneway houses and garden suites play a vital role in meeting the demand for more housing options while sprinkling a little extra charm and personality into our neighbourhoods.

What Are Laneway Houses and Garden Suites?

Laneway houses, also known as coach houses or back houses, are fully self-contained dwelling units that stand independently from the main house. Usually positioned in the backyard and facing the rear lane, these units range in size from studios to three-bedroom homes and must contain kitchen and bathroom facilities, restricted to a single dwelling unit. A laneway suite is specifically located on a lot that borders a publicly designated laneway. In contrast, garden suites, though similar, are generally smaller and positioned in the backyard of a property. These versatile units can function as guest houses, rental units, or additional living space for homeowners. The regulations for both garden and laneway suites are governed by two separate portions of the zoning by-law. Unlike laneway suites, garden suites do not require access to a public laneway, making them a more accessible choice for homeowners throughout Toronto.

Regulations and Permits

Ah, regulations and permits – the bureaucratic red tape that makes even the most patient homeowner want to pull their hair out.  Fear not, there are plenty of experts and resources to help you navigate through this labyrinth of rules and regulations.

Before beginning a project for a laneway house or garden suite, it’s crucial to be well-versed in the regulations and permits required by the city of Toronto. These regulations, outlined by the city, play a significant role in determining the feasibility and cost of your project. For instance, the city’s ordinances aim to safeguard its trees and preserve permeable surfaces for rainwater absorption. The process for obtaining permits and adhering to zoning ordinances is designed to ensure that your property can accommodate this type of additional dwelling unit. It’s important to note that your application could be denied, underscoring the importance of understanding and complying with the requirements and limitations before proceeding with design plans for a laneway suite.

For instance services for your laneway or garden suite are typically supplied from the main house. Although electrical service can often be independently metered through Toronto Hydro, gas and water services typically share a meter with the primary residence. However, there are various options available to monitor the usage attributed to the laneway or garden suite. Furthermore, due to the house’s backyard location, ensuring its accessibility in case of a fire and proximity to fire hydrants is essential.

For a comprehensive understanding of how to navigate the planning and design process within Toronto’s ordinances and laws, the City Planning department offers a great video outlining basic information, as well as a document summarizing the ordinances and requirements.

Cost Considerations

Building a laneway house or garden suite can be a significant investment, so it’s important to budget accordingly. Costs can vary depending on factors such as size, design complexity, existing conditions and location.

Hard costs include foundation work, building envelope, HVAC, electrical, plumbing, and interior finishes. It’s important to factor in these various considerations when budgeting for a laneway or garden suite construction project in Toronto. Additionally, there are soft costs to consider, including applications and permits, surveyors and engineers, house designer fees, HVAC design, builder’s insurance, and lumber estimates.

The management approach is another key factor – if you’re DIY-ing it, you might save some cash, but if you’re hiring a property manager, be prepared to fork over a bit more. Self-managed construction may cost around $350 per square foot, while using a hired property manager can increase costs to $450+ per square foot. The size of the suite is a significant factor in costs, as certain fixed costs like demolition, foundation, and service installations are more pronounced in smaller spaces. The cost per square foot tends to decrease for larger units, as certain expenses like electrical panels and furnaces remain fairly fixed regardless of size.

The choice of construction method also affects costs, with underpinning representing a significant expense. Choosing to excavate a basement can considerably raise expenses, which could negatively impact the rent-to-cost ratio from an investment perspective. The level of quality in the build, such as minimal materials, mid-level finishes, or luxury finishes, will also affect costs and depend on the target market and rental rates in the area.

It’s all about finding the right balance between quality and affordability.

So, when you’re budgeting for your laneway house or garden suite, make sure to consider all these factors. After all, you don’t want to end up with a half-finished project and an empty wallet.

Design and Construction

When it comes to design, homeowners have a range of options to choose from. Some may opt for a modern, minimalist design, while others may prefer a more traditional look that complements the existing home. Sustainable and eco-friendly construction practices can also be incorporated, such as using recycled materials or installing energy-efficient appliances.

Cost considerations are integral to the design and construction process. Factors such as size, design complexity, and material choices can significantly impact the overall cost of building a laneway house or garden suite. Sure, you could go all out with high-end finishes and sustainable materials, but remember, you’re not building a castle (unless you are, in which case, can we be friends?). It’s important to carefully consider these factors and budget accordingly to ensure that the project remains financially feasible.

Are Laneway and Garden Suites the Ultimate Home Upgrade?

Benefits and Downsides of Laneway Houses and Garden Suites

Laneway houses and garden suites offer a variety of benefits to homeowners, making them a popular choice for property upgrades. One of the most significant advantages is the potential to generate additional income. These secondary units can be rented out to tenants, providing a steady stream of rental income for homeowners. Generally, these suites are more cost-effective compared to condos and can generate higher rental income than basement apartments or other secondary suites.

Additionally, laneway houses and garden suites can also be used to house extended family members or create a space for adult children to live independently. This flexibility in use makes them a versatile option for homeowners looking to maximize the utility of their property.

Another key benefit of laneway houses and garden suites is their ability to increase property value. When looking at it as an investment, the return on investment (ROI) is higher compared to a condo of similar parameters. The condo option will usually cost about double the amount and carry higher monthly costs, laneway houses and garden suites offer a more cost-effective option with a potentially higher ROI. (See this handy laneway & garden suite cashflow and ROI calculator).

Furthermore, laneway houses and garden suites can provide a solution to housing shortages in urban areas by increasing the overall housing stock.

To encourage the development of laneway houses and garden suites, the City of Toronto has launched two programs. The Deferral Program for Ancillary Secondary Dwelling Units allows qualifying property owners to postpone development charges when building a secondary dwelling at the rear of their property. The Affordable Laneway and Garden Suite Program offers eligible property owners funding through a forgivable loan of up to $50,000 for the development of a laneway or garden suite. This loan will be forgiven 15 years from the date when the first tenant occupies the unit, provided that the rent does not exceed the City of Toronto’s Average Market Rent by bedroom type during the affordability period.

However, it’s not all sunshine and rainbows. Adding a laneway house or garden suite can lead to higher property taxes due to the increased property value. Homeowners may also have less outdoor space and could lose a garage, which could be a deal-breaker for some. Privacy concerns are also something to consider. Before diving into this housing trend, homeowners should weigh these potential downsides against the benefits of adding a laneway house or garden suite to their property.

Enhancing Toronto Living: The Rise of Laneway and Garden Suites

Laneway houses and garden suites offer a compelling solution for Toronto homeowners looking to expand their living spaces and possibly increase property value. These units provide additional living space, potential rental income, or a separate living area for family members. As Toronto’s housing options expand, laneway houses and garden suites play a crucial role in meeting the city’s growing housing needs.

So, whether you’re looking to make some extra cash, create a cozy space for loved ones, or boost your property value, laneway houses and garden suites are a solid choice. Just remember, with great housing options comes great responsibility – so make sure to do your homework before diving in!

Are Laneway and Garden Suites the Ultimate Home Upgrade?

Are Laneway and Garden Suites the Ultimate Home Upgrade?

Are you intrigued by the idea of laneway houses and garden suites as a home upgrade? We can provide insights and assistance to help you explore these options further.

Reach out to us today for personalized advice and start planning your path to a more versatile and valuable property!

Have any questions or just wanna chat?  Give me a call or send me an email.

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Thinking of selling? Check out our 8 Steps To Selling Your Home.

* Prices mentioned in this article are approximate and may vary based on factors such as the cost of materials, labor charges, and location. It’s advisable to obtain quotes from local contractors and suppliers to get a more accurate estimate for your specific project.

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